Ethereum is a software platform using blockchain technology. Ether is the native crypto token of the Ethereum platform. Ethereum can be used as a foundational platform to create innovative digital applications. The native token is also used as a reward for work done supporting the platform.
Ethereum is designed to be decentralized, secure, and scalable. Developers prefer to use the Ethereum blockchain to create future technologies. These innovations built on the Ethereum platform have the potential to change how many major industries operate.
The Ethereum platform supports smart contracts. Defi and other applications use smart contracts together
with blockchain technology.
When Was Ethereum created?
Vitalik Buterin created Ethereum in 2015 to provide solutions for Bitcoin’s issues. Buterin detailed smart contracts and automated immutable ‘if-then’ statements in a white paper published in 2013. DApps already existed in the blockchain space, but platforms were not interoperable. One of the objectives of Ethereum was to unify these platforms.
Think of Ethereum as an app store, with thousands of apps in one place, all following the same rules. These sets of rules are coded into the Ethereum network and enforced autonomously. Developers will be able to set their own rules for their DApps. There is no central authority enforcing regulations and changes in Ethereum; instead, the power is in the hands of the people who are part of the Ethereum community.
Over the years, many developers came to Ethereum with their ideas for decentralization. These users founded the DAO in 2016. The DAO is a democratic group that can vote on network proposals and changes.
How Does Ethereum work?
The Ethereum network exists on many thousands of computers all over the world. Ethereum users participate as nodes as this network does not have a centralized server. The decentralized nature of Ethereum makes it highly immune to crypto attacks. It does not matter if one node goes down, as thousands are holding the network up.
Ethereum is a decentralized system that runs a computer called the Ethereum Virtual Machine (EVM). Each node has a copy of EVM. Any interactions must be verified for everyone on the network to update their copy.
The interactions in the network are known as transactions. These transactions are stored within blocks on the Ethereum blockchain. Miners have to validate these blocks before they are recorded on the blockchain.
Ethereum has recently shifted to the proof-of-stake consensus mechanism from proof of work. This shift makes the Ethereum blockchain faster, energy efficient and easily scalable. There are several more upgrades of Ethereum which are yet to be released.
Like Bitcoin, all transactions made in the Ethereum network are made public. Miners broadcast the new blocks to the rest of the network to confirm the change. The new blocks are added to everyone’s copy of the ledger. Verified blocks cannot be changed or tampered with.
Each transaction in Ethereum comes with a fee known as gas. Gas is paid by users to initiate their transactions. The gas serves as a limit by restricting the number of actions per transaction. Gas also helps reduce network spam. The supply of ETH is infinite, as it is a utility token. ETH is consistently in circulation as it is used for staking rewards.
What is Ethereum 2.0?
The merge was originally referred to as Ethereum 2.0 and is an upgrade of the Ethereum blockchain to use a proof-of-stake consensus mechanism to verify transactions on the network.
The new staking mechanism replaced the old proof-of-work system, where crypto miners use high-powered computers to solve complex mathematical equations known as hashes. The proof-of-work system uses a lot of electricity to verify blocks on the Ethereum blockchain.
The Ethereum network is expected to reduce its carbon footprint by up to 99.95% after it moved to the proof of stake consensus mechanism. This switch to the new consensus system will help address one of the major criticisms of ETH.
How to Buy Ethereum?
Crypto investors can buy Ethereum either on centralised or decentralised exchanges. ZebPay is India’s oldest crypto exchange. ZebPay’s systems have been battle tested through various market cycles. Users can buy and sell ETH using the Zebpay platform.
Conclusion
One of the big achievements of the Ethereum network is decentralized finance. DApps performing multiple functions within the ecosystem started popping up around 2019 and have only grown in popularity. The Ethereum network will only grow as more DApps are used every day. Popular DApps bring more attention to the platform.
Artists are making money by bringing their work to the Ethereum blockchain via NFTs. We might wonder why we should buy expensive digital art when we can take a screenshot, but collectors want ownership. NFTs serves as a secure form of storage and also hold proof of ownership. These features make it highly appealing to collectors.
So is it safe to invest in ETH? The answer depends on your financial risk tolerance and goals. Like other crypto coins, ETH can be volatile. However, it is worth researching Ethereum as an investment due to the emerging innovative applications and technologies that use it. These emerging technologies have the potential to play a larger role in our lives in the future.
You can now buy ETH using the Zebpay platform. Level up your trading experience using ZebPay’s brand new updates.
| Homepage | Click Hear |
